Old and new crowd mix it up in Greenpoint

Merchants on Manhattan Avenue see risks and opportunities in the area's arrivistes.

The strip's oldest shop, the Peter Pan Donut and Pastry Shop, is a big hit with new arrivals.Photo: Philip Murtha

At El Born, a posh new Spanish restaurant in northern Brooklyn not far from the East River, diners can seat themselves in the coolly modernist space and sup on such delicacies as cod with squid ink ($11) and foie gras with fresh quince in a balsamic reduction ($18). And they do.

"Every table is taken on the weekends," said Elena Manich, a native of Spain who moved to New York five years ago. "There are a lot of young people coming in."

What's surprising about this picture is that the 50-seat El Born, with its 20-seat backyard café, is not in hyper-hot Williamsburg, nor in staid Brooklyn Heights. It stands at 651 Manhattan Ave., in the commercial heart of Greenpoint, a quiet neighborhood known for decades mostly for its tightly knit population of middle-class Polish families, and for the bakeries, restaurants and shops along the avenue that cater to them.

As is the case in many other gentrifying areas in the city, old-line retailers are being replaced by a pricier and more modern generation, but in Greenpoint there are also signs that a fair bit of the old may yet coexist with the new.

Just ask Herman Hernandez, owner of George's Toy Center at 738 Manhattan Ave. He is confident enough that he recently renewed his lease for another 10 years—though not at the rent his landlord had originally asked for.

"He wanted to increase my rent by 65%," said Mr. Hernandez, whose old-fashioned shop carries everything from Barbie dolls to Lego sets. "I was able to cut that increase in half."

Perhaps buoyed by that success, Mr. Hernandez is optimistic.

"When I first bought the store, this was a strong Polish community, but now I'm seeing younger professionals and younger families," said the retired police officer turned retailer. "This is a bustling avenue, and they are patronizing the stores and spending money."

Others are also staying put. At the 17-year-old Polonia Restaurant at 631 Manhattan Ave., owners say they will continue to serve home-style Polish favorites, including beef goulash ($15.99) and pierogies ($6.99), as long as their customers come, which they show every sign of doing—augmented by a smattering of new faces as well.

Meanwhile, the Peter Pan Donut and Pastry Shop, one of the oldest surviving businesses on the avenue, continues to crank out hand-made doughnuts, as it has since 1954. Only now the line of people waiting outside its door in the morning boasts at least as many new-to-the-neighborhood faces as old—which accounts for why the line is longer than ever. As well it should be. In the era of the hybrid $5 Cronut, Peter Pan charges a mere $1.10 for its classic glazed donut and $1.55 for its chocolate éclair.

Migration from Billyburg

Just as many veteran businesses prosper by cultivating the new crowd and holding on to the old, some of the fresh arrivals on the avenue are targeting a similar mix of patrons. The recently opened women's boutique Violet Pepper at 688 Manhattan Ave. is an example. The store, owned by eight-year Greenpointer Jade Elzien, sells everything from $99 Bass tasseled loafers to $168 Emma Legging jeans.

"I want to cater to the neighborhood newcomers but also to the people who made this neighborhood what it is," said Ms. Elzien. "I'm really hoping the quirky new shops help spur business for the existing retailers as well."

Two things are certain, however: Over time, the Polish community will shrink and rents will rise.

"Once a stronghold of aging Eastern European immigrants, the neighborhood is now attracting younger people who cannot afford to live in Williamsburg," said Michael Breen, a real estate agent at Douglas Elliman, who covers Williamsburg and Greenpoint.

He predicts that those numbers will swell still further with the opening of the Greenpoint Landing Development. The waterfront complex, which will begin construction in 2015, will include more than 1,400 housing units spread among 10 high-rise towers, as well as a new park and a school. "More retail is naturally going to follow an influx of people to this area," he added.

Costs, too, are on the rise as the new generation of retailers swallows previously unheard-of rents. Among them is Crystal Pei, the owner of Nordic-themed coffeehouse Budin. For a 1,950-square-foot shop on Greenpoint Avenue just off Manhattan Avenue, she agreed to shell out a whopping $70 per square foot in rent. Ms. Pei said she liked the feel of the neighborhood and thought it "a good fit" to sell her imported Northern European roasts. At $7 a cup, they are specially brewed and served in small carafes on shiny chrome-plated platters. And while the asking price paid by Ms. Pei is not yet the retail norm, that day will come.

Rising rents

In just the past three years, average retail rents have spiked 50%, to $60 per square foot. For longtime businesses, including Jam's stationery and Zayas Appliances, a 40-year-old family-run shop, the rent became unaffordable.

During the past few years, they and at least 10 others along Manhattan Avenue have been replaced by such newcomers as Van Leeuwen, an artisanal ice-cream shop, and Torst, a Danish beer bar.

"A lot of people are complaining that rents are rising and it's getting more expensive," said Paul Kang, who is closing his nearly 40-year-old Imagic Photo store on Manhattan Avenue because of dwindling business. "But change is good. It brings new life to the neighborhood."

A version of this article appears in the May 26, 2014, print issue of Crain's New York Business as "Old and new crowd mix it up".

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